I dont personally see any problem with what the OP has done. It really sounds....mind you from only one side of the dispute....like the guy agreed....then got a better deal....in that the item was sold to someone closer. It really amounts to a auction then....since the two were negotiating meeting for the FTF transaction, and the seller sold to the buyer that would then cost less time and fuel money....more of a net to the seller after the " i will take it". IMO the OP also did the right thing in being proactive by contacting a Moderator.
I would personally like either a negative or neutral to remain with the seller. If all feedback is good, then what use is the feedback system. I imagine the thread will be closed and the ratings deleted....since how do you leave feedback, when there is no transaction.